- Operating profit at United Solar Ovonic segment increased to $8.6 million
in fiscal 2006 compared to an operating loss of $3.2 million in fiscal
2005, on a 49% increase in revenues
- Annualized solar module production capacity at existing Auburn Hills
facility reached 28MW during the fourth quarter
- The second Auburn Hills 30MW solar manufacturing facility is expected to
begin operation in Fall 2006
- Construction of solar cell manufacturing facility in Greenville, Michigan
with an estimated capacity of 60MW per annum is underway and operation is
expected in late 2007
- Next phase of solar module manufacturing expansion is the addition of a
second 60MW solar cell facility in Greenville expected to begin operation
in mid-2008
- Cobasys began producing battery systems for GM's Saturn VUE Green Line
HEV
- Ovonyx continued to secure significant, new licensees for its OUM
technology
- ECD Ovonics successfully completed a common stock offering with net
proceeds of over $361 million, principally to fund United Solar Ovonic's
capacity expansion
ROCHESTER HILLS, Mich., Sept. 12 /PRNewswire-FirstCall/ -- Energy
Conversion Devices, Inc. (ECD Ovonics) (Nasdaq: ENER) today reported its
results for the fiscal year and fourth quarter ended June 30, 2006. The
company reported a net loss of $18.6 million (or $0.57 per share) on
revenues of $102.4 million in fiscal 2006, as compared to net income of
$50.3 million (or $1.70 per fully-diluted share) on revenues of $156.5
million in fiscal 2005. The fiscal 2005 results reflect a one-time, noncash
license fee of $79.5 million received in fiscal 2005. The company also
reported a net loss of $0.8 million (or $0.02 per share) on revenues of
$27.9 million in the fourth quarter of fiscal 2006, as compared to a net
loss of $6.9 million (or $0.23 per share) on revenues of $20.9 million in
the fourth quarter of fiscal 2005.
"We continued to improve performance and expand our business in the
fourth quarter, which contributed to an overall solid year," said Chairman
and CEO Robert C. Stempel. "We are especially pleased with the performance
of our United Solar Ovonic segment, which continues to expand its sales and
manufacturing capacity, and at the same time improve its gross margins. Our
Cobasys and Ovonyx joint ventures are also performing well."
Mr. Stempel added, "Unfortunately, in a year marked by so many positive
events for our company, we are saddened by the sudden loss of our dear
friend and colleague Dr. Iris Ovshinsky, who co-founded our company. She
will be missed."
The following are highlights from ECD Ovonics' 2006 fiscal year:
-- ECD Ovonics' wholly owned subsidiary United Solar Ovonic had
operating income of $8.6 million on revenues of $87.5 million in fiscal
2006, as compared to an operating loss of $3.2 million on revenues of $58.7
million in fiscal 2005. Announced new business included 6MW of solar
products for Actus Lend Lease and 46MW of solar products for Spazio Energia
S.R.L. and Sunerg Solar S.R.L.
-- United Solar Ovonic's gross profit margin increased to 22% in fiscal
2006 from 9% in fiscal 2005, reflecting increased production and sales and
improved absorption of fixed costs as manufacturing production advanced
toward its expected capacity of 30MW per annum. On a quarter-by-quarter
basis, United Solar Ovonic's gross profit margin increased in each of the
last six quarters, and was 24% in the fourth quarter of 2006.
-- United Solar Ovonic continued to improve its solar module
manufacturing capacity at its Auburn Hills I facility, which reached 7.0MW
in the fourth quarter of fiscal 2006. Its new 30MW Auburn Hills II
facility, which will be a duplicate of its Auburn Hills I facility, is
nearly complete and is expected to become operational in the Fall of 2006.
-- ECD Ovonics announced plans in March 2006 to expand United Solar
Ovonic's solar module manufacturing capacity to an expected capacity
exceeding 300MW per annum by 2010. As part of this expansion, the company
also announced that it is constructing a 60MW solar cell manufacturing
facility in Greenville, Michigan, which is expected to become operational
in late 2007. In addition, last week, ECD Ovonics announced that it is
adding a second 60MW solar cell manufacturing facility in its Greenville
site, which is expected to begin operation in mid-2008.
-- ECD Ovonics' Production Technology and Machine Building Division is
manufacturing and delivering the proprietary solar module manufacturing
equipment for the new Auburn Hills 2 facility on budget and on schedule.
This division is continuously improving its manufacturing efficiency, which
will result in lower costs and shorter manufacturing cycles for the
announced Greenville, Michigan facilities, as well as future expansion
projects.
-- ECD Ovonics' Cobasys LLC joint venture began supplying battery
systems to General Motors Corporation for its new Saturn VUE Green Line
hybrid. Cobasys, the only United States-based supplier of NiMH battery
systems for hybrid electric vehicles, continued to successfully compete for
new business opportunities.
-- Cobasys is supplying its NiMH battery systems for the Saturn VUE
from its state-of-the-art manufacturing facility in Springboro, Ohio, which
is fully certified to all standards required to be a supplier to the
automakers.
-- ECD Ovonics' Ovonyx, Inc. joint venture secured new licenses with
major chip manufacturers globally to commercialize Ovonic Unified Memory
(OUM) technology and one of its licensees, BAE, announced a product based
on OUM technology.
-- ECD Ovonics' combined research and development costs and net
operating, general and administrative expenses were relatively unchanged in
fiscal 2006 despite the growth in production and sales at United Solar
Ovonic. At the same time, the company continued research and development
activities to define marketable technologies that can result in commercial
products and continues to pursue third-party funding, including strategic
alliances and government contracts, to offset its funding requirements for
these activities.
-- ECD Ovonics completed a common stock offering in March 2006 and
raised net proceeds of approximately $361 million principally to expand
United Solar Ovonic's solar manufacturing capacity.
-- At June 30, 2006, ECD Ovonics had approximately $404.5 million of
cash, cash equivalents and short-term investments on hand, reflecting the
net proceeds from its March 2006 stock offering. The company recognized
interest income of $8.7 million in 2006, due principally to significant
increase in cash and short-term investments.
-- The improved quarter-over-quarter results were principally due to
the continuing growth and improved gross margins at United Solar Ovonic and
higher interest income, together with approximately $1.4 million of
favorable one- time items in 2006.
Additional information about the Company and its consolidated financial
results can be found in the Company's Annual Report on Form 10-K for the
year ended June 30, 2006, which was filed with the Securities and Exchange
Commission today and will be available on the company's website.
Conference Call Information
ECD Ovonics will hold a conference call today, September 12, 2006, at
5:00 p.m. (Eastern Daylight Time) to discuss operating results for fiscal
year and fourth quarter ended June 30, 2006. To access the conference call,
please call (877) 858-2512 or (706) 634-1291. A live webcast of the
conference call will be available online at http://www.ovonic.com/investor
or through the Company's website at http://www.ovonic.com . A replay of the
call will be available approximately one hour after the conclusion of the
call through close of business on Friday, September 15, 2006, at (800)
642-1687 or (706) 645-9291. Callers should use conference ID 5564743 to
access the conference call and the replay.
About ECD Ovonics
ECD Ovonics is the leader in the synthesis of new materials and the
development of advanced production technology and innovative products. It
has invented, pioneered and developed its proprietary, enabling
technologies in the fields of energy and information leading to new
products and production processes based on amorphous, disordered and
related materials. The Company's portfolio of alternative energy solutions
includes Ovonic thin-film amorphous solar cells, modules, panels and
systems for generating solar electric power; Ovonic NiMH batteries; Ovonic
hydride storage materials capable of storing hydrogen in the solid state
for use as a feedstock for fuel cells or internal combustion engines or as
an enhancement or replacement for any type of hydrocarbon fuel; and Ovonic
fuel cell technology. ECD Ovonics' proprietary advanced information
technologies include Ovonic phase-change electrical memory, Ovonic
phase-change optical memory and the Ovonic Threshold Switch. ECD Ovonics
designs and builds manufacturing machinery that incorporates its
proprietary production processes, maintains ongoing research and
development programs to continually improve its products and develops new
applications for its technologies. ECD Ovonics holds the basic patents in
its fields. More information on the Company is available on
http://www.ovonic.com .
This release may contain forward-looking statements within the meaning
of the Safe Harbor Provisions of the Private Securities Litigation Reform
Act of 1995. Such forward-looking statements are based on assumptions which
ECD Ovonics, as of the date of this release, believes to be reasonable and
appropriate. ECD Ovonics cautions, however, that the actual facts and
conditions that may exist in the future could vary materially from the
assumed facts and conditions upon which such forward-looking statements are
based. The risk factors identified in the ECD Ovonics filings with the
Securities and Exchange Commission, including the Company's most recent
Annual Report on Form 10-K could impact any forward-looking statements
contained in this release.
Energy Conversion Devices, Inc. and Subsidiaries
Consolidated Statements of Operations
Year Ended June 30 Quarter Ended June 30
2006 2005 2006 2005
(in thousands, except per-share amounts)
Revenues
Product Sales $84,431 $51,944 $22,082 $15,627
Royalties 4,246 5,332 1,028 1,586
Revenue from Product
Development Agreements 10,045 17,653 2,597 2,962
Revenue from License
and Other Agreements 1,322 80,784 538 538
Other 2,375 857 1,684 195
Total Revenue 102,419 156,570 27,929 20,908
Expenses 129,640 113,187 33,849 28,142
Income (Loss) from
Operations (27,221) 43,383 (5,920) (7,234)
Other Income (Expense)
Interest Income 8,671 1,400 5,141 806
Interest Expense (197) (776) - (235)
Equity Loss in Joint
Ventures (150) (100) - -
Distribution from Joint
Venture - 8,000 - -
Impairment Loss in Rare
Earth Ovonic - China - (1,710) - -
Other Nonoperating Income
(Expense) (13) 90 10 13
Total Other Income (Expense) 8,311 6,904 5,151 584
Net Income (Loss) from
Continuing Operations Before
Income Taxes and Extraordinary
Item (18,910) 50,287 (769) (6,650)
Income Taxes (Benefit) - 825 - (1)
Net Income (Loss) from
Continuing Operations
Before Extraordinary Item (18,910) 49,462 (769) (6,649)
DISCONTINUED OPERATIONS
(including gain on
disposition of discontinued
operations of $740 in the
fiscal year ended
June 30, 2006) 314 (1,393) - (251)
Extraordinary Item
(Net of Taxes) - 2,263 - (3)
Net Income (Loss) $(18,596) $50,332 $(769) $(6,903)
Basic Net Income (Loss)
Per Share
Continuing Operations $(.58) $1.80 $(.02) $(.22)
Discontinued Operations .01 (.05) - (.01)
Extraordinary Item - .08 - -
$(.57) $1.83 $(.02) $(.23)
Diluted Net Income (Loss)
Per Share
Continuing Operations $(.58) $1.67 $(.02) $(.22)
Discontinued Operations .01 (.05) - (.01)
Extraordinary Item - .08 - -
$(.57) $1.70 $(.02) $(.23)
SOURCE Energy Conversion Devices, Inc.
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Related links:
http://www.ovonic.com
http://www.ovonic.com/investor
CONTACT:
Sanjeev Kumar, Vice President and CFO,
Ghazaleh Koefod, Investor Relations, of Energy Conversion
Devices, Inc., +1-248-293-0440; Bruce MacDonald of
Liebler!MacDonald, +1-248-233-8062
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